[Federal Register Volume 67, Number 8 (Friday, January 11, 2002)]
[Notices]
[Pages 1531-1532]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-760]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-45240; File No. SR-PCX-2001-53)


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Pacific Exchange, Inc. 
Relating to Ceiling on Marketing Charges

January 7, 2002.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on December 26, 2001, the Pacific Exchange, Inc. (``PCX'') filed with 
the Securities and Exchange Commission (``Commission'') the proposed 
rule change as described in Items I, II and III below, which the PCX 
has prepared. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    The PCX is proposing to establish a ceiling on marketing charges of 
$200 per trade. The text of the proposed rule change is available at 
the PCX and at the Commission.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the PCX included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it had received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The PCX has prepared summaries, set forth in Sections A, 
B, and C below, of the most significant aspects of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The PCX recently adopted a payment-for-order-flow program under 
which it charges a marketing fee ranging from $0 to $1.00 per contract 
on a per-issue basis.\3\ The PCX charges the marketing fees as set 
forth in the Schedule of Rates that it periodically files with the 
Commission.\4\
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    \3\ See Securities Exchange Act Release 44830 (September 21, 
2001), 66 FR 49728 (September 29, 2001) (SR-PCX-2001-37).
    \4\ See Securities Exchange Act Release No. 45167 (December 18, 
2001), 66 FR 67346 (December 28, 2001) (SR-PCX-2001-49).
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    The PCX is proposing to establish a ceiling of $200 per trade for 
the marketing fee. The PCX believes that the proposed rule change is 
reasonable and equitable because, in its view, capping each trade at 
$200 would provide sufficient money for LLMs to maintain the marketing 
program while lessening the economic burden on Market Makers. By its 
terms, the proposed ceiling would become effective beginning with the 
January 2002 trade month.
2. Basis
    The PCX believes that the proposal is consistent with Section 6(b) 
of the Act,\5\ in general, and Section 6(b)(4) of the Act,\6\ in 
particular, in that it provides for the equitable allocation of 
reasonable dues, fees, and other charges among its members.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The PCX does not believe that the proposed rule change will impose 
any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    The PCX neither solicited nor received written comments on the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing 
for Commission Action

    Because the PCX has designated the foregoing as a fee change 
pursuant to Section 19(b)(3)(A) of the Act \7\ and Rule 19b-4(f) 
thereunder,\8\ it has become effective immediately upon filing with the 
Commission. At any time within 60 days after the filing of this 
proposed rule change, the Commission may summarily abrogate the rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act.
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    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 240.19b-4(f).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. 
Copies of the submission, all subsequent amendments, all written 
statements with respect to the proposed rule change that are filed with 
the Commission, and all written communications relating to the proposed 
rule change between the Commission and any person, other than those 
that may be withheld from the public in accordance with the provisions 
of 5 U.S.C. 552, will be available for inspection and copying in the 
Commission's Public Reference Room. Copies of such filing will also be 
available for inspection and copying at the principal office of the 
PCX. All submissions should refer to File No.

[[Page 1532]]

SR-PCX-2001-53 and should be submitted by February 1, 2002.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 02-760 Filed 1-10-02; 8:45 am]
BILLING CODE 8010-01-M